Standardized computer system total cost of ownership assessments and benchmarking

ABSTRACT

A method of collecting data used in assessing total cost of owning enterprise computing systems is provided. The method includes distributing, to an enterprise computing system, an electronic data file that identifies, for use by a data extraction tool, predefined data source fields within the enterprising computing system and that relate to costs included in a predefined cost model that defines costs to be included in an analysis of a total cost of owning an enterprise computing system. The method also includes receiving, from the enterprise computing system, cost information aggregated using data extracted using the distributed data file, wherein the cost information is structured in conformity with the predefined cost model. The method further includes using the received cost information to formulate benchmark total cost of ownership cost information that is structured in conformity with the predefined cost model.

CROSS REFERENCE TO RELATED APPLICATION

This application claims the benefit of U.S. Provisional PatentApplication No. 60/488,626, filed Jul. 18, 2003, the contents of whichare herein incorporated by reference.

TECHNICAL FIELD

This description relates to assessing the total cost of ownershiprelated to the ownership of a computing system, and more particularly toa new approach for making such assessments, based on an appropriatetotal cost of ownership (TCO) model.

BACKGROUND

Total cost of ownership (TCO) is a commonly used metric for measuringwhether to purchase a computing system for an enterprise, and indetermining how to optimize the use, or deployment of, such a computingsystem. There exist various approaches to assess the TCO for a computingsystem, offered on the one hand by information technology (IT) analysts(for example, Gartner, Meta, Forrester, etc.), and on the other hand byvarious software and hardware vendors (Microsoft, Oracle, etc). As such,there has not developed a common standardized understanding about whatTCO is all about and what are the reference parameters classifying it.Existing approaches differ in either the time they take into account indetermining TCO, in the cost components and elements that are consideredrelevant to a TCO determination and in the reference parameters neededfor data classification. For example, Meta in its TCO approach does nottake into account indirect costs, while Gartner within its classical TCOapproach does not take into account project costs like systemimplementation.

In addition, in that IT analysts have a different understanding aboutwhat cost components should be considered, IT analysts therefore alsohave a different understanding of what time frame to consider wheninvestigating TCO. For example, Gartner in its standard TCO benchmarkmetric only takes into account a one year time frame. Also, while Metadoes not take into account indirect costs, Gartner does take such costsinto account. Finally regarding the degree of breakdown of the costcomponents included in a TCO analysis, while Meta only determines atotal sum for operations costs with no detailed breakdown, Gartner has amore detailed break-out of cost components included for operations. Thereason is that Gartner mainly focuses on operation costs when assessingTCO for a computer system

SUMMARY

Generally, there is provided a standardized methodology for performingassessments of the total cost of owning enterprise computing systems.The methodology uses a standardized predefined model that defines thecosts to be included in such an assessment, and also provides the toolsfor data collection and analysis. The methodology enables usefulbenchmarking against cost information for similar systems and thatconforms to the same standardized predefined model.

In one aspect, a method of collecting data used in assessing total costof owning enterprise computing systems is provided. The method includesdistributing, to an enterprise computing system, an electronic data filethat identifies, for use by a data extraction tool, predefined datasource fields within the enterprising computing system and that relateto costs included in a predefined cost model that defines costs to beincluded in an analysis of a total cost of owning an enterprisecomputing system. The method also includes receiving, from theenterprise computing system, cost information aggregated using dataextracted using the distributed data file, wherein the cost informationis structured in conformity with the predefined cost model. The methodfurther includes using the received cost information to formulatebenchmark total cost of ownership cost information that is structured inconformity with the predefined cost model.

In various implementations, the method may include one or more of thefollowing features. The method may also include receiving costinformation compiled by an information technology consultant andincluding costs associated with an enterprise computing system, andwhich consultant-provided cost information is structured in conformitywith the predefined cost model. The method may also include distributingthe electronic data file identifying the predefined data source fieldsto multiple enterprise computing systems, receiving the aggregated costinformation from each of the multiple enterprise computing systems, andusing the aggregated cost information received from each of the multipleenterprise computing system in formulating the benchmark costinformation.

Multiple different benchmark cost information may be formulated forenterprising computing systems having a different predefined value for apredefined characteristic of enterprise computing system, or in otherwords, which belong to a common cluster of systems. The predefinedcharacteristic may be a size category of an enterprise in which theenterprise computing system is implemented or an industry type categoryfor an enterprise in which the enterprise computing system isimplemented.

The method may also include electronically distributing the determinedbenchmark cost information to an enterprise computing system. In such acase, the enterprise computing system to which the benchmark costinformation is distributed may be configured to aggregate costinformation related to its total costs of ownership in conformity withthe predefined cost model. Also, the enterprise computing system towhich the benchmark cost information is distributed may be furtherconfigured to provide a comparison of its aggregated total cost ofownership cost information with distributed benchmark cost informationreceived by the enterprise computing system.

In another aspect, a method is provided of supporting an assessment of atotal cost of owning an enterprise computing system. The method includesreceiving total cost of ownership cost information relating toenterprise computing systems, wherein the cost information for each suchenterprise computing system is structured in conformity with apredefined cost model that defines costs to be included in an analysisof a total cost of owning an enterprise computing system. The methodalso includes using the received cost information to formulate benchmarktotal cost of ownership cost information that is structured inconformity with the predefined cost model. The method also includesdistributing to an enterprise computing system 1) a total cost ofownership cost analysis tool that is designed in conformity with thepredefined cost model and that is used to perform a local analysis ofthe total cost of ownership for the enterprise computing system to whichthe cost analysis tool is distributed, and 2) the formulated benchmarktotal cost of ownership cost information for use in the local total costof ownership analysis.

In various implementations, the method may include one or more of thefollowing features. The receiving of the cost information isaccomplished at least in part by 1) distributing, to an enterprisecomputing system, an electronic data file that identifies, for use by adata extraction tool, predefined data source fields within theenterprising computing system and that relate to costs included in thepredefined cost model; and 2) receiving, from the enterprise computingsystem, cost information aggregated using data extracted using thedistributed data file, wherein the cost information is structured inconformity with the predefined cost model.

Again, multiple different benchmark cost information may be formulatedfor enterprising computing systems having a different predefined valuefor a predefined characteristic of enterprise computing system. Thepredefined characteristic may be a size category of an enterprise inwhich the enterprise computing system is implemented, and may beindustry type category for an enterprise in which the enterprisecomputing system is implemented. The distribution of the determinedbenchmark cost information may be accomplished by electronicallydistributing the determined benchmark cost information to an enterprisecomputing system.

In addition, the enterprise computing system to which the benchmark costinformation is distributed may be configured to aggregate costinformation related to its total costs of ownership in conformity withthe predefined cost model. Also, the enterprise computing system towhich the benchmark cost information is distributed may be furtherconfigured to provide a comparison of its aggregated total cost ofownership cost information with distributed benchmark cost informationreceived by the enterprise computing system. The receiving of the costinformation may be accomplished at least in part by receiving costinformation compiled by a information technology consultant andincluding costs associated with an enterprise computing system, andwhich consultant-provided cost information is structured in conformitywith the predefined cost model.

The details of one or more embodiments of the invention are set forth inthe accompanying drawings and the description below. Other features,objects, and advantages of the invention will be apparent from thedescription and drawings, and from the claims.

DESCRIPTION OF DRAWINGS

FIG. 1A-1I are diagrams illustrating a standardized cost structure forthe total cost of owning an enterprise computing system.

FIG. 2 is a conceptual diagram to an approach for conducting TCOanalyses.

FIG. 3 is a block diagram of example systems involved in the approachfor conducting TCO analyses shown conceptually in FIG. 2.

FIG. 4 is a block diagram showing more detail of an enterprise computingsystem shown in FIG. 3.

FIG. 5 is a block diagram showing more detail of software tools shown inFIGS. 3 and 4.

FIG. 6 is a flow chart of a method of conducting TCO analyses ofenterprise computing system based on the TCO model as a standardized,structured approach.

FIG. 7 is a flow chart of a method of collecting TCO data.

FIG. 8 is a block diagram of computing system components involved in theexecution of program instructions.

Like reference symbols in the various drawings indicate like elements.

DETAILED DESCRIPTION

A total cost of ownership (TCO) model for enterprise computing systems,as shown in FIGS. 1A-J and as described in this document, is a holisticview of a cost structure and covers direct costs as well as indirectcosts, investment costs as well as ongoing/running costs. The modelcomprises life cycle and cost component views. Cost elements areassigned to each cost component, which in turn are assigned to costcategories, as shown in FIG. 1I.

-   -   Cost Category=for example, hardware/software invest,        implementation, etc.    -   Cost Component=for example, technical setup, business setup,        etc.    -   Cost Element=for example, business configuration,        add-ons/customer development    -   Cost Types=for example, investment/project costs, running costs,        etc.        This TCO approach is focused on costs arising for an enterprise        computing system (ECS) solution within initial setup,        operations, continuous improvement and release management, as        well as in the area of end user operations.        An Example TCO Model

As shown in FIG. 1A, an example TCO model is divided into seven majorcost categories, in which six are direct budgetary cost categories whilethe last is an indirect non-budgetary one. In detail, the budgetarycosts are hardware/software investment costs, implementation expenses,ongoing hardware/software costs, operations costs, expenses forcontinuous improvement project costs, and upgrade project costs. Costsin the area of end user usage that are incurred by cut over and runningthe system cannot be measured as specifically as the direct costs, andthus have an rather indirect character. Nevertheless, they have majorimpact and thus should typically be taken into account. These previouslymentioned cost categories will be described in detail in the following.

A. Hardware/Software Invest

Components of this cost category are firstly the investment costs forthe technical infrastructure in terms of the required computinghardware, network and equipment within the end-user environment.Secondly, part of this cost category is system software, including allexpenses in the computing as well as in the end user area. Finally, partof this cost category is also the actual investment costs for thesolution licenses (excluding maintenance fees). The cost components aredefined in more detail below. It is noted that this investment costcategory includes not only the initial investment costs, but alsoincludes acquisition costs for hardware that arises due to an upgradeproject, e.g., additional servers.

1. Technical Infrastructure

The cost elements of technical infrastructure are shown in FIG. 1B. Ingeneral, there is a distinction between the technical infrastructuresneeded in the central installations, including the computing hardware,the equipment required for the network and the actual hardware for theend users. While the computing hardware combines all the costs foracquiring servers, storage, databases, backup units, the cost element“Network (Investment)” refers to the investment costs of the networkenvironment. In contrast, the end-user environmental hardware consistsof all the costs for acquiring the end-user “work stations”—whetherstatic or mobile. These different cost elements are defined individuallyin the following.

Computing Hardware (Investment): The cost element computing hardwarecombines all the costs of running a computing center, that is, therequired hardware for the application software, additional costs such asthe for storage units and any associated costs. These costs are assignedwith the acquisition costs. In detail, this includes all applicationservers, the databases belonging to them, and the middleware and storageservers. Besides also the costs of security and archiving the data, forexample backup units and archiving systems, are assigned to this costcomponent as well. Apart from the actual computing hardware in thebroadest sense, the entire initial construction changes essential torunning the computing environment—like the room, air conditioning, powersupply—are included in case they arise and there is a causal connection.

Network (Investment): The cost element network combines all the costsfor the network environment required for running the applicationsoftware. Those include the setup and adjustment costs for the actualrequired network. These costs are assigned to the acquisition costs. Indetail, these include, in addition to the actual network, the costs ofsecurity such as firewall servers and connections such as networkswitches. Thereby, the actual hardware as well as all constructionchanges that might occur are taken into account.

End-User Environment (Investment): In contrast to the computing hardwareand network costs, this cost element includes all costs of running adecentralized infrastructure based on the computing hardware and itsnetwork. These costs are assigned to the acquisition costs. In detail,this means that all of the costs arise at the end-user working placessuch as the client/server system, and includes the equipment belongingto it (keyboard, mouse, and so on) as well as any mobile equipment, suchas mobile devices. Examples are tablet personal computers, handhelds,and cell phones that are required to work with the solution.

2. System Software

The cost component “System Software,” also shown in FIG. 1B, refers toall kinds of costs related to software “usage rights.” Depending on thepricing model, fixed and variable costs result. An example of fixedcosts includes a specific contract volume, while the variable partsmight be the fee for special services. Further, variable costs mayinclude the recalculation of changed or incorrectly sized systems oradditional charges for the right to use specific software. While thevariable part of the fee is assigned to the annual ongoing softwarecosts, the fixed elements are counted as initial costs within the costcomponent. Similar to the division of the technical infrastructure intothe cost elements computing and end-user environmental hardware, thesame division exists for “system software”—there are “usage rights” forservers and databases, and licenses for end-user groupware rights. Here,only the separation of the application software licenses intoself-contained cost component is taken into account.

Computing Software (Initial): Consequently, the computing softwarecombines all of the rights regarding the deployment and management ofthe servers, middleware, storage, network, and so on. This is mainly theactual system software in form of the operating system but also otherrights-related costs that may be incurred, for example, fixed costs forfirewalls, separate middleware software, archiving or monitoringsoftware.

End-user Environmental Software (Initial): Apart from the computingsoftware, the end-user environmental software includes all rights forworking at the end-user front end. A classical example is the usagerights for the operating system and groupware licenses.

3. Application Software

Parts of this cost component, shown in FIG. 1B, are all costs related tothe license costs of the actual application software. This can be, forinstance, the actual core enterprise resource planning (ERP) software.Thus, the license cost might be split up in several parts, or might bepart of one contract. The base for pricing may be, among others, theamount and type of users, the engines as technical base underneath thecustomer solution, or the throughput of defined objects.

B. Implementation

The cost category “Implementation” deals with the initial implementationof a software solution on the customer side. The implementation processstarts with the presales phase and ends when the solution is productive.All project costs incurred afterwards are part of the cost categorycontinuous improvement, either in terms of a rollout of the implementedsolution or a continuous business improvement. As shown in FIG. 1C, theimplementation phase is divided into seven major cost components. Indetail, these are the process design as the conceptual phase, followedby a realization phase consisting of the organization changes, thetechnical and business setup, and the testing. Simultaneously, thetraining is realized and the project management is in place. In thiscontext, note that the cost components are not divided by chronologicalsequence, but rather are divided by their functions. Thus, there is kindof interaction between all of these cost components in theimplementation phase. The cost categories of the cost components“Implementation” are described in the following.

1. Process Design

The purpose of this cost component is to get a clear big picture of theimplementation scope of the specific software solution. As shown in FIG.1C, this cost component includes the definition of the objectives of thesoftware solution implementation and tries to identify the conditionsthat need to be fulfilled to achieve the targets of the actualrealization phase. It is mainly divided into two major cost elements—the“Planning of Infrastructure” and the “Blueprint/Conception” of thesolution. While the “Planning of Infrastructure” includes all costsrelated to the sizing of the system and the vendor evaluation process,the cost element “Blueprint/Conception” incorporates all of the expensesfor the actual process design. Note that IT strategy costs in terms ofdevelopment of an overall company IT strategy are excluded explicitly,as they can be interpreted as kind of neutralized. They would arise inany case, regardless what kind of standardized business software thecompany would implement. Costs are only in focus upon starting theactual realization phase (technical and business side).

Planning of Infrastructure: The planning is an analysis of the processesfrom a technical point of view and is intended to clarify therequirements of the solution by investigating the number of users, therequired performance, analysis of the existing technical infrastructure,and other related tasks. Thus, the “Planning of Infrastructure” includesall the tasks that relate to the realization of the identifiedrequirements, for example, the sizing of the hardware so that thebusiness processes can run in the way they are required later on, andthe detection of potential dependencies, such as the platform type.

Blueprint/Conception: The main focus of the blueprint phase is todevelop a thorough conceptual approach for the procedures andrequirements for reproducing the business processes in the system. Allexpenses related to this area of activity are combined within the costelement “Blueprint/Conception.” In detail, this includes theinvestigation of the company's specific characteristics, choice offunctionality, definition of the specific requirements, and, derivedfrom this, the definition of the relevant customizing settings, thedefinition of the user roles, the authorization requirements, and, ifmade, the specification of code modifications. In this context, somematters have to be clarified additionally, such as the implementationstrategy and the standards for the implementation.

2. Organizational Changes

Organizational changes sums up all expenses related to introducing thesoftware solution into the actual organization, and includes, forexample, the operations procedure of the employees. A good example isthe change of operations procedure of an employee who used to havebusiness contact in an informal way but now is required to contact viathe business solution (for the sake of data consistency, transparency,etc.). In contrast to training, this is not the teaching of the actualapplication handling, but rather is the change in the mindset ofemployees. In contrast to Business Process Reengineering, this hasnothing to do with the performing of overall checks of allorganizational tasks and work cycles within the company in terms ofcritically examining how reasonable and effective the processes withinthe company are. While training is part of a separate cost component,general Business Process Reengineering is excluded entirely. The reasonfor its exclusion is that any organizational change activity that is notdirectly linked to the solution can be seen as cost neutral. It wouldarise in any case, regardless how efficiently the processes can bemapped within the system. Thus, the simplicity of adapting anorganization to the actual software is kept in focus.

3. Technical Setup

This cost component combines, as shown in FIG. 1C, all costs related tothe more technical tasks of getting the system started. It is dividedinto the installation of all software, the configuration, and theoverall technical operations throughout the implementation process,including technical change management. At the same time, the definitionand development of the technical conception, mainly used for operationslater on, is part of the technical setup cost component.

Installation: Installation is the implementation of all softwarenecessary to run the system and the system landscape from a technicalpoint of view. In detail, this includes the installation of the systemsoftware, for example, the operating software. On top of this, the coreapplication software and related software is installed, for example,groupware and tools.

Technical Configuration: The purpose of the configuration task is todesign the initialized software in line with the company's specificrequirements, including integration of the various applications. Indetail, this is the configuration of the application software and thesoftware related to it, for example, groupware and tools from atechnical point of view, such as monitoring parameters, performanceparameters, definition of alerting, etc.

Technical Operations: Part of this cost element is the operations of thesystem throughout the whole implementation phase. This corresponds, tosome degree, to actual operations after the system goes live, forexample, the system monitoring. Here, technical operations begin withthe deployment of the first software component. Examples are monitoringthe solution components in every respect, administration tasks like loadbalancing and transport management, and technical tests, for example,backup recovery tests.

Technical Conception: The technical conception deals with the design ofrules for normal operations and in case of emergency. Since a keycompetitive factor is that the system be secure and process dataconsistently, scenarios may need to be developed to deal withdeviations. Examples are the development of general operationalguidelines, the creation of archiving and backup routines, the design ofbackup recovery scenarios, and the definition of security policy.

4. Business Setup

The business setup includes, as shown in FIG. 1C, all activitiesnecessary to form and run the actual software solution in a way it isconceptually defined within the blueprinting of the process design. Toachieve this business fit of the solution, various tasks are typicallycarried out, starting with the business configuration of the applicationin terms of maintaining the relevant settings. Further on, the businesssetup includes the customization of all the necessary systemdiversifications, for instance, extension through add-ons/customer codeor modifications. Other key tasks are the fade in of all relevant dataand migration of existing data—for example, from legacy systems into thenew system, adaptation and creation of reports based on the businessneeds, and setup/adjustment of the forms and workflows. Creation of theauthorization concept and user profiles also are typically carried out.This is illustrated in detail in the following. In this context it istaken into account that in case a customer is not deploying a solutionwith components from a single vendor, but rather is using a vendor'splatform as development environment, the costs arising by thedevelopment of individual applications is accordingly included inBusiness Setup.

Business Configuration: Business Configuration combines all of theefforts related to configuring the application(s) as required for thebusiness fit. As the functionality offered within the software has to beadapted to the requirements of the companies, various settings aremaintained to get the software to work in the way the process itself isrealized in the company. For instance, within the pricing it needs to bedetermined what discounts are offered for what kinds of products and inwhat timeframes. Business Configuration is different fromadd-ons/customer code or modifications. While Business Configurationonly includes the efforts related to tuning the settings in the standardsoftware, add-ons/customer code and modifications are new coding addedto the actual coding in the standard version.

Reporting/Forms/Workflows: This cost element covers the setup and designof the reports, forms and workflows for the solution. In detail, withina company there are various reports used for the analytical analysisand/or graphical presentation of data. To have reports that take intoaccount the company-specific requirements for analytics, either reportsthat have already been shipped need to be altered or new reports need tobe set up. There are also various kinds of forms and workflows that haveto be adjusted where the standard is not sufficient. Therefore, both thedesign of the forms and workflows and the actual working procedurebehind it need to be maintained. Examples are bill forms that have to bedesigned in accordance with the actual company bill design, in whichcase, the system has to be configured so that it prints according tocompany-specific requirements. All costs related to the setup and designof these reports, forms and workflows are included in this cost element.

Interfaces: To integrate the different software solutions from ourvendor as well as with third-party systems, interfaces have to be set upto enable the transfer between the different elements of the softwaresolution. This can be realized for instance by business adapters,special customer developments, and so on. All efforts related to thesetup and design of the interfaces for the purpose of integration isincluded in this cost factor. In the case of an incremental deployments,interfaces in terms of bridging transition systems with the finalsoftware solution are built up during implementation.

Add-ons/Customer Development: Add-ons/Customer Development areextensions either to the standard software or to customer individualdeveloped applications, whereby new functionality is inserted usingstandardized interfaces in the original software. This functionality canbe standardized extensions or deployed standard softwarecompany-specific coding that communicates using these standardizedinterfaces. All efforts related to the setup of the add-ons/customercode have to be assigned to this cost factor. The cost elements“Add-Ons/Customer Development” has to be distinguished from the costelement “Modification/Extensibility.” While Add-Ons/Customer Developmentadds functionality in a certified way using standardized interfaces,Modifications reflects the upgrade instability of adding of code.

Migration/Upload/Creation (Master/Organizational Data): If a productionsystem is replaced by a new solution, the data in the legacy system hasto be transferred to the new system. Migration is the transfer of thedata, for example, organizational data, from the legacy productionsystem to the newly implemented one, which, in the future, will be theproduction system. This process includes the actual transfer, thepreparatory work, and the subsequent maintenance effort. An example isdata for various sites of an enterprise about capacity, transportationschedules, and transportation lanes, data about suppliers, and so on. Incomparison, transactional data is the order of a specific amount ofgoods and the planning of its production based on the capacity data. Theefforts related to the creation/preparation and/or import of this datain the system is included in this cost element.

Modification/Extensibility: The cost element“Modification/Extensibility” is the adjustment/enhancement of thestandard software solution in a non-certified and thus upgrade instableway. While the cost elements “Add-Ons/Customer Development” deals withupgrade stable adding of code, adjustment of User Interface (e.g., fieldextensions), etc., the cost element “Modification/Extensibility” dealswith the upgrade instable enhancement/change of code.

User Management: Within the system, specific users have differentpermissions for various system objects, such as areas within thebusiness processes or specific transactions. Thus, for every user anduser type, specific permissions have to be declared. This is realized bya type of authorization concept in which every user is an object with aspecific role, and the necessary permissions are assigned to thisobject. The permissions depend on the role that the user holds withinthe company. The costs related in the broadest sense to the setup of theauthorization concept (where applicable, aligned with the customersecurity policy) as well as the realization of it are included in thiscost element.

5. Testing

To guarantee the system runs smoothly, it is essential to executegeneral cross-functional tests, as well as tests that focus on theaccuracy of the actual developments. The different types of testing,like module, component, or integration testing, are subdivided intoconceptual test preparation for defining the test objective, performanceof the test, and the subsequent analysis including potential issuemanagement for any incidents identified by the testing, and are part ofthis cost elements. Examples for test types are testing of definedprocesses (business functionality) and scenario-specific requirements(data volume and mass tests), as well as integration requirements(integration testing). On a pure technical level, it refers toavailability of a technical component.

6. Training

To introduce the implementation team members, power users and end usersto the setup and implemented system, it is necessary to help them getused to the routines and functionality and enable them to handle thesolution. Therefore, it is necessary to develop training concepts forthe functionality. The training itself can be carried out locally at thecompany or externally and can be realized in various forms, such as, forinstance, by help of tutorial tools or classroom training. Thus, anytraining costs have to be assigned to this cost component.

7. Project Management

Project Management includes, as shown in FIG. 1C, all costs incurred byorganizational tasks for the sake of implementation coordination. Alsoincluded is the identification and setup of some kind of supportorganization.

Project Management/Implementation Coordination: All coordinating andorganizational activities related to the implementation project aresummarized within the cost element “Project Management/Implementation.”Examples are work package coordination, as well as internal and externalcommunication, mainly represented by some kind of project office.

Setup Support Organization: The setup of the support organization—adecisive part of the subsequent operation phase—takes place. Whileduring the implementation, various experts are available locally in thecompany who can generally solve potential problems quite easily andflexibly, a support structure has to be created for when only some ofthe experts are still at the company but are still responsible for allproblems that arise in the centralized and decentralized solutioninfrastructure. Expenses related to this area are summarized to the costelement “Setup Support Organization.”

C. Hardware/Software Ongoing Costs

The cost category “Hardware/Software Ongoing Costs” is structured in thesame manner as the related cost category “Hardware/Software Invest.” Adistinctive factor is that while the investment costs deal with theinitial acquisitions costs, the ongoing costs deal with its (e.g.,annual) maintenance expenses. As in the investment section, the costcategory “Hardware/Software Ongoing Costs” consists of, as shown inFIGS. 1A and 1D, the cost components “Technical Infrastructure,” “SystemSoftware” and “Application Software.” They are described in detail inthe following.

1. Technical Infrastructure

Maintenance refers to all expenses regarding the maintenance of thehardware in its actual status. Thus, the spares and supplies required byall types of software solution hardware, are assigned to this costcomponents. Expenses therefore are either covered by a kind of“maintenance contract,” or might be paid individually. In general, thereis a distinction between the technical infrastructures needed in thecentral installation computing hardware, the equipment required for thenetwork, and the actual hardware for the end users. While themaintenance costs for computing hardware include all the costs formaintaining servers, storage, databases, backup units, the cost element“Network” refers to the maintenance costs of the network environment. Incontrast the maintenance expenses for end-user environmental hardwareconsists of all the costs for maintaining the end-user “workstations”—whether static or mobile. These different cost elements aredefined individually in the following.

Computing Hardware (Maintenance): The cost element “Computing Hardware(Maintenance)” combines all the costs of maintaining the initiallyacquired hardware of a computing center, that is, the required hardwarefor the application software, additional costs like for storage unitsand any associated costs. These costs are assigned either with its fixedfee (e.g. monthly maintenance charge) or individual maintenance costs(e.g. expenses for spares and supplies). In detail, this refers to themaintenance of all application servers, the databases belonging to it,and the middleware and storage servers. Besides also maintenance costsrelated to the security and archiving of data, for example backup unitsand archiving systems, are assigned to this cost element as well. Apartfrom the actual computing hardware in the broadest sense, themaintenance fees for the actual data center—like the room, airconditioning, power supply—have to be included in case they arise andthere is a causal connection.

Network (Maintenance): The cost element “Network (Maintenance)” combinesall maintenance costs for the network environment required for runningthe application software. These costs are assigned either with its fixedfee (e.g., monthly maintenance charge) or individual maintenance costs(e.g., expenses for spares and supplies). In detail, these include theactual network the maintenance costs of security like firewall serversor connection like network switches. Thus, the actual hardware as wellas all constructional changes that might occur are taken into account.

End-User Environment (Maintenance): In contrast to the computinghardware and network costs, the cost element “End-User Environment(Maintenance)” includes all of the maintenance costs of running adecentralized infrastructure based on the computing hardware and itsnetwork. These costs are assigned either with its fixed fee (e.g.,monthly maintenance charge) or individual maintenance costs (e.g.,expenses for spares and supplies). In detail, this means that allmaintenance costs arise at the end-user working places, such as for theclient/server system, the equipment belonging to it (keyboard, mouse,and so on), as well as any mobile equipment such as mobile devices.Examples are maintenance and repair charges for tablet PCs, handhelds,and cell phones that are required to work with the solution.

2. System Software

The cost component “System Software” refers to all kinds of costsrelated to software “usage rights.” Depending on the pricing model,fixed and variable costs result. While the fixed elements are counted asinvestment costs within the cost component “System Software (Invest),”the variable part of the fee is assigned to the annual ongoing softwarecosts. Thus, the structure of the cost component “System Software(Invest)” is transferred to this costs component. The only distinctionis that within this cost component the ongoing maintenance fees are infocus—instead of the initial investment costs. As in the investmentsection, also here the separation of the application software licensesinto self-contained cost component is taken into account.

Computing Software (Ongoing Fees): Consequently, the computing softwarecombines all fees for the rights regarding the software for managementof servers, middleware, storage, network, and so on. This includesmainly the maintenance charge for the actual system software in the formof the operating system, but also other rights-related costs that may beincurred, for example, fees for firewall-software, middleware software,archiving, and monitoring software.

End-user Environmental Software (Ongoing Fees): Apart from the computingsoftware, the end-user environmental software includes all fees relatedto the rights for working at the end-user front end. A classical exampleare maintenance charges for the usage rights of the operating system andgroupware licenses.

3. Application Software

This cost component includes all maintenance costs related to the usageright of the actual application software. This can be, for instance, theactual core enterprise resource planning (ERP) software. According tothe structure of the license cost, the maintenance fee might be split upin several parts among the various components of the enterprisecomputing system.

D. Operations

The implementation phase is complete by the time the system goes live.All subsequent activities are part of the productive phase. The costsrelated to the actual operations of the system are part of the costcategory “Operations.” To get a clear picture of the costs and how theyare incurred, the cost category “Operations” is divided into systemoperations and application operations, as shown in FIGS. 1A and 1E.While the system operations refers to the more technical with respect tosystem oriented maintenance of the solution, the cost componentapplication operations focuses more on the business related systemmaintenance activities. A detailed description is outlined in thefollowing.

1. System Operations

System operations refer to all rather technical oriented activities,more focusing on the hardware constitution, system software andapplication software from a technical point of view. Typically theseactivities are more related to the maintenance of the data centerinfrastructure, and therefore, are performed centralized within the datacenter. They only have indirect linkage to the actual business relatedactivities, and staff providing this work is characterized by a rather“technical” oriented skill set. Looking on the cost component “systemoperations,” it consists of the cost elements “system monitoring,”“system administration,” “System Problem Management,” “Software ChangeManagement,” “System Service Desk & Incident Management” and“General/administrative costs for System Operations.” They will bedefined in the following.

System Monitoring: In general, monitoring means all activities relatedto control the correct operations of the system. It has a more proactiveand ongoing character. Consequently, it plays an important part duringthe whole operational phase. In general, there can be divided roughlythe more business oriented monitoring from the rather technical,hardware and network monitoring. The borderlines especially in theapplication area are fluent in terms of the activities. Thus, adistinguishing characteristic is less the pure activity than rather theskill set required for it. While the monitoring of networks, database,and hardware is performed by rather technical experienced staff, thecorrect performing of business activities and the monitoring of businessprocesses requires staff that rather is versed in the value chain of thecompany. Thus, while the more technical oriented monitoring is performedwithin the system operations, and expenses are assigned to the costelement “system monitoring” accordingly, the rather business-drivenmonitoring is more likely realized by experts of the various departmentand thus part of the application operations. Examples for systemmonitoring are the check of availability of components, monitoring ofnetwork traffic, and load balancing referring to hardware resources andmonitoring of capacities.

System Administration: The cost element “system administration” refersto the maintenance activities of the solution in the broadest sense,either in terms of periodical tasks or extraordinary activities.According to the distinction outlined previously, the cost element“system administration” deals with the technical oriented administrativetasks. Examples are system landscape maintenance, starting and stoppingactivities, capacity management (hardware, configuration, operationmodes, etc.), network administration, high availability management, jobscheduling in terms of periodical administrative jobs, databasemanagement (including backup, restore and test), archiving activitieslike data archiving or document management, output management, securitymanagement, and quality assurance.

System Problem Management: The cost element “system problem management”deals with all activities that serve the resolution of a problem afterits identification form a more technical point of view. In general, aproblem is defined as an unknown underlying cause of one or moreincidents, and a known error is a problem that is successfully diagnosedand for which a work-around has been identified. Thus the goals ofproblem management are the detection of underlying causes of an incidentand their subsequent resolution and prevention. Activities to achievethese goals are the determination of permanent solutions, e.g. bysearching for structural improvements in the IT infrastructure toprevent as many future incidents as possible. Thus, the speed with whicha resolution is found is only of secondary (albeit still of significant)importance. Examples are logging and tracing, for instance in terms ofcentral logging, single activity tracing or performance tracing. It istaken into account that while the problem management requires apermanent solution and prevention of an incident and classification ofthe speed with which a resolution of this incident is found, onlysecondary the incident management aims to restore the service forincident resolution to the customer as quickly as possible. This meansthat while the focal point of incident management is the restore normaloperation as quickly as possible, problem management aims to providelong-term stability in the infrastructure by finding, eliminating, andpreventing the causes of incidents.

Software Change Management: The cost element “Software ChangeManagement” all activities related to the continuous change managementof the solution from a rather technical point of view. The goal ofchange management is to ensure standardized methods and procedures forefficient and prompt handling of all changes and the reduction ofnegative impact caused by change-related incidents (in contrast torelease management that deals with change management aspects of arelease upgrade). Example changes are characterized by their nature thatthere should not be delivered any new functionality. In fact, existingfunctionality should be improved in terms of its quality. Thus, softwarechange management includes all costs related to this software qualityimprovement process from a technical point of view. In detail, this isthe planning process, the actual realization in terms of installation(as part of the system operations) as well as in terms of necessaryadjustments and the testing/validation from a technical as well as froma business point of view. Thus, distinctive factor once more is less theactual activity than more the required skill set—technical versusbusiness oriented. While expenses related to the rather businessoriented task of the software change management are sum up under theaccording cost element of the application operations, the more technicaloriented tasks of the software change management are assigned to thesystem operations accordingly. Examples are the patching of components,installation of single corrections, and the transport of customerdevelopment and modifications.

System Service Desk & Incident Management: System Service Desk &Incident Management deals with the service desk of system-related issuesand the incident management that arises in the area of the rathertechnical issues. The service desk provides the single point of contactfor users to capture, track and resolve service requests and incidents.Thus, service requests (in case there does not exists automation interms of an “employee self services”) are the creation of user accountsor its management. Also, incident management is a part of this costcomponent. As previously mentioned, the focal point of incidentmanagement is to restore normal operations as quickly as possible, incontrast to problem management that aims to provide long-term stabilityin the infrastructure by finding, eliminating and preventing the causesof incidents. An example is the managing of incidents according to adefined service level (e.g., unavailability or high response time),including the defined escalation procedure. It is noted that support iscomparable to a gradual way of incident management, starting at a locallevel and moving on to a global or development level when the problemcannot be solved. Part of this cost element are all expenses incurred byany business related support activity, regardless of the type oforganization it is realized, e.g. first/second/third level support.Thus, system service desk and incident management either aims to restorethe service for incident resolution to the customer as quickly aspossible or offer services required for general solution maintenance,whereby the resolved incidents and supported services have a rathertechnical focus. Services desk and incident management also includesactivities like service level reporting (figures on professional servicequality), etc.

General/Administrative Cost for System Operations: Part of thegeneral/administrative costs for system operations includes expensesthat are more of a general nature and serve more than one area directly.Thus, all costs that cannot be assigned unequivocally to any of thepreviously mentioned cost elements but firstly are related to theoperations of the solution and secondly have a more technical focus areassigned to this cost element. An example is training expenses fortechnical administration staff. The training might have positive effectson the capability regarding problem management as well as the capabilityof correct administration. As described previously, training therebyincludes all costs incurred to enable the staff to gain knowledgeregarding system-related tasks and characteristics and to handletechnical-related issues efficiently. It follows the same structure.Examples are all expenses related to IT coordination. This includes allcosts that arise by managing the IT staff and responsibilities from anorganizational point of view. In detail, this includes the managementstaff and/or administrative staff responsible for the resourceallocation, payroll or the communication and alignment with othergroups, such as other departments and partners.

2. Application Operations

Application Operations sums up all expenses that are directly related tothe actual running of the application and requiring the support/skillset by business experienced employees. In detail, this includes thecosts for proactive monitoring and simultaneous administration, problemmanagement, software change management, the service desk and incidentmanagement, and general/administrative cost for application operations.In contrast to system operations, application operations are stronglyrelated to the actual business of the company and thus a distinctivefactor is the required skill set. While system-related activities can beperformed with a rather technical oriented mindset, applicationoperations require the support and skill set by business experiencedstaff.

Monitoring: As mentioned previously, there are in general two types ofproactive and ongoing controlling of correct system status: 1) the morebusiness oriented monitoring, and 2) the rather technical, hardware andnetwork focused monitoring. According to this distinction, parts of thecost element “Monitoring” within the cost component “applicationoperations” are only those monitoring activities that are related to theactual business. Examples for application monitoring are the statuscheck of approval workflows, the status of orders, and the alertmanagement of business process. In contrast, system monitoring dealswith the monitoring activities regarding the hardware and the network,as they are not directly linked to the business but rather to the ITinfrastructure beneath it. All expenses (e.g. in terms of staff costs)related to these rather business-oriented monitoring activities areassigned to the cost element “monitoring” within application operations.

Application Administration: The cost element “applicationadministration” refers to the maintenance activities of the solution inthe broadest sense, either in terms of periodic tasks or extraordinaryactivities. According to the distinction outlined previously, the costelement “application administration” deals rather with the ratherbusiness oriented administrative tasks. Examples are the maintenance ofbusiness processes, their starting and stopping, the job planning andcreation (including exceptions), the planning of archiving of businessrelated structured and unstructured data or the quality assurance from abusiness point of view.

Problem Management: The cost element “system problem management” dealswith all activities that serve the resolution of a problem after itsidentification from a more business point of view. In general a problemis defined as an unknown underlying cause of one or more incidents, anda known error is a problem that is successfully diagnosed and for whicha work-around has been identified. Thus, the goals of problem managementare the detection of underlying causes of an incident and theirsubsequent resolution and prevention. Activities to achieve these goalsare the determination of permanent solutions, e.g., by searching forstructural improvements in the IT infrastructure to prevent as manyfuture incidents as possible. Thus, the speed with which a resolution isfound is only of secondary (albeit still of significant) importance. Itis taken into account that while the problem management requires apermanent solution and prevention of an incident and the classificationof the speed with which a resolution of this incident is found is onlysecondary, the incident management aims to restore the service forincident resolution to the customer as quickly as possible. This meansthat while the focal point of incident management is restoring of normaloperation as quickly as possible, problem management aims to providelong-term stability in the infrastructure by finding, eliminating, andpreventing the causes of incidents.

Software Change Management: The cost element “Software ChangeManagement” includes all activities related to the continuous changemanagement of the solution from a rather business point of view. Asmentioned previously, a goal of the change management process is toensure standardized methods and procedures for efficient and prompthandling of all changes and to reduce any negative impact caused bychange-related incidents (in contrast to release management that dealswith change management aspects of an release upgrade). Thus, softwarechange management includes all costs related to this software qualityimprovement process. In detail, this is the planning process, the actualrealization in terms of installation (as part of the system operations)as well as in terms of necessary adjustments and the testing/validationfrom a technical as well as from a business point of view. Thus,distinctive factor once more is less the actual activity and more therequired skill set—technical versus business oriented. While expensesrelated to the rather technical-oriented task of the software changemanagement are summed up under the according cost element of the systemoperation, the more business-oriented tasks of the software changemanagement are assigned to the application operations accordingly.

Service Desk and Incident Management: System service desk and incidentmanagement deals with a service desk of application-related issues andthe incident management that arises in the area of the business issues.In this context, the service desk provides the single point of contactfor users to capture, track and resolve service requests and incidents.Thus, service requests (in case there does not exist automation in termsof a “guided procedure”) are the closure of accounts and the problemsthat arise due to the missing ability of further post-entry. Incidentmanagement is also part of this cost component. The focus of incidentmanagement is restoring normal operations as quickly as possible, incontrast to problem management that aims to provide long-term stabilityin the infrastructure by finding, eliminating, and preventing the causesof incidents. Examples are the managing of incidents according to adefined service level (e.g. insufficient response time due to accessvolume on pricing or pegging functionality), including the definedescalation procedure. It is noted that support is comparable to agradual way of incident management, starting at a local level and movingon to a global or development level when the problem cannot be solved.Part of this cost element is all expenses incurred by any businessrelated support activity, regardless of the type of organization inwhich it is realized, e.g. first/second/third level support. Thus, thesystem service desk and incident management either aims to restore theservice for incident resolution to the customer as quickly as possibleor offer services required for general solution maintenance, whereby theresolved incidents and supported services have a rather business focus.Part of the services desk and incident management includes alsoactivities like service level reporting (figures on professional servicequality).

General/Administrative Cost for Application Operations: Parts of thegeneral/administrative costs for application operations are all thoseexpenses that are more of a general nature as they serve more than onecost element directly. Thus, all costs that cannot be assignedunequivocally to any of the previously mentioned cost elements, butfirstly are related to the operations of the solution and secondly havea more business related focus, are assigned to this cost element. Anexample is training expenses for key users within certain businessdepartments. The training might have positive effects on the capabilityregarding monitoring, as well as the ability of efficient problemmanagement. As described previously, training thereby includes all costsincurred to enable the staff to gain knowledge of system-related tasksand characteristics and to handle technical related issues efficiently.It follows the same structure. Examples are all expenses related to ITcoordination in case they arise. This includes all costs that arise bymanaging the business related staff. In detail, this is the managementstaff and/or administrative staff responsible for the resourceallocation, payroll or the communication and alignment with othergroups, such as other departments and partners.

E. Continuous Improvement Projects

Application requirements in the IT landscape change over time forseveral reasons. Companies institute business or organizational changesand for this they implement additional functions or they fall back onimprovements for the implemented solutions provided by the softwarevendor with a new release. This can be addressed by a continuousimprovement process or by an upgrade. Besides depending from theimplementation approach the initial implementation might be continued interms of stepwise “implementation” of further functionality (incrementaldeployment vs. big bang approach) or in terms of rollout activities ofalready implemented functionality. It has to be taken into account thatthe cost category “continuous improvement projects” is separate from“release management” in terms of “upgrade”. Regarding the upgrade costcomponent, it only includes those costs that arise by realizing arelease upgrade, while the continuous improvement cost componentincludes all costs, incurred by improving the application based on adefined release version. Expenses for “Continuous Improvement Projects,”shown in FIG. 1F, are incurred by internal or external projects andexceed certain duration (e.g. two days). The duration upon a task has“project status” has to be defined by its company characteristics, e.g.size of company.

1. Continuous Business Improvement

Part of this cost component are those expenses caused by the continuousimprovement of the application from a business perspective—either interms of continuation of an initial implementation project or by thecontinued adjustment of the standard business software solution tochanging business needs. In detail, this is the renewed configuration ofthe application and potential use of new functionality (that is alreadyavailable within the application release), add-ons, and further customerdevelopments to ensure continuous adjustment and improvements to meetmarket requirements. All of these costs are incurred by internal orexternal projects and exceed a certain duration (e.g., two days). Theduration upon a task is defined by company or cluster the company belongto. The structure of the cost component “Continuous BusinessImprovements” thereby is copied from the structure of the initialimplementation project. This should guarantee the comparability andcomplete recordability of project data, independent of whether the datarefers to the continuation of the initial implementation project or thecontinuous improvement of the standard business software to new businessneeds. The cost elements defining the cost component “ContinuousBusiness Improvement” are outlined shortly in the following. In general,their definition outlined within the cost category implementation isstill valid in this connection.

Process Design: The purpose of this cost element is to get a clearpicture of the project scope of the continuous improvement project. Itincludes the definition of the objectives of the software solutionimplementation and tries to identify the conditions that need to befulfilled to achieve the targets of the actual realization phase. It ismainly divided into the “Planning of Infrastructure” and the“Blueprint/Conception” of the solution.

Organizational Changes: Organizational changes sums up all of theexpenses related to introducing the adjusted software solution into theactual organization, such as the operations procedure of the employees.

Technical Setup: This cost element combines all costs related to themore technical tasks that arise throughout the continuous improvementproject. This could be the installation of additional software,adjustment of the operating concept, and further technicalconfiguration.

Business Setup: The business setup includes all activities necessary toadjust/enhance the actual software solution in the way it isconceptually defined within the blueprinting of the process design. Toachieve this business fit of the solution, various tasks are carriedout, starting with the business configuration of the application interms of maintaining the relevant settings. The business setup alsoincludes the customization of all the necessary system diversifications,for instance extensions through add-ons, customer code, ormodifications. Depending on the continuous improvement project, otherkey tasks are the fade in of data and migration of existing data—forexample from legacy systems into the adjusted solution. Also, theadaptation and creation of reports based on the business needs andsetup/adjustment of the forms and workflows can be in focus. Creation ofthe authorization concept and user profiles also might occur.

Testing: To guarantee that the system runs smoothly after finalizationof the continuous improvement project, it is essential to executegeneral cross-functional tests, as well as tests that focus on theaccuracy of the actual developments. The different types of testing,like module, component, or integration testing, are subdivided intoconceptual test preparation for defining the test objective, performanceof the test, and the subsequent analysis including potential issuemanagement for any incidents identified by the testing, and is part ofthis cost element.

Training: To introduce the implementation team members, power users andend users, to the adjusted/enhanced software solution, it is necessaryto help them get used to the routines and functionality and enable themto handle the solution. Therefore, it is necessary to develop trainingconcepts. The training itself can be carried out locally at the companyor externally, and can be realized in various forms, like for instanceby help of tutorial tools or classroom training. Thus, any trainingcosts attributed to the continuous business improvement project areassigned to this cost element.

Project Management: Project management includes all costs incurred byorganizational tasks for sake of implementation coordination and/or theeffects (e.g., adjustment requirements) and/or required supportactivities of the support organization.

2. Continuous Technical Improvement

According to the continuous business improvement, parts of this costcomponent are those expenses caused by the continuous improvement arenot of the application, but are of the technical infrastructure.Examples are the setup of a data-achieving concept within the operationsor the consolidation of system landscape/server hardware. Thus, the coststructure of the cost component “Continuous Technical Improvement”follows the same cost structure as any project within the “ContinuousImprovement” cost component.

3. Rollouts

As mentioned before, the implementation phase ends when the system goeslive. All costs incurred afterwards as project costs are part of thecost category continuous improvement and are assigned accordingly. Incase the implementation project is being continued after the solutionhas gone live in terms of a roll out of the solution to specific companysubsidiaries or departments, the costs arise after the actual going lifeof the system, and these rollout activities are assigned to the costcomponent “Rollout” accordingly. Thus, the cost structure of the costcomponent “Rollout” follows the same cost structure as any projectwithin the “Continuous Improvement” cost component.

F. Upgrade Projects

The cost components elements of the “Upgrade Projects” cost category areshown in FIGS. 1A and 1G.

1. Application Upgrade

As already mentioned, another possibility is to adapt applications tochanging requirements or to just improve them from a technical point ofview by upgrading them. This is also part of the continuous improvementprocess, but due to its importance and extraordinary character it isanalyzed separately. The upgrade is comparable to an implementationproject. However, in this connection the degree of adjustment regardingspecific cost elements is of interest. Thus, the different areas inwhich the changes arise are analyzed. This cost component includes theprocess design, organizational changes, the technical setup, thebusiness setup, the testing and training, and the project management. Adistinctive factor is the deployment of a new release version, forinstance, in case a customer wants to take advantage of the valuepotential delivered by this further improved software solution toimprove its possibility to react on business needs and forces within itsown value chain and/or the one in which the customer is imbedded. Thecost elements of the cost component “Upgrade” are described shortly inthe following.

Process Design: This cost element includes all efforts related toevaluating and planning the upgrade, the description of the requiredadjustment, and, if required, the coordination of the project.

Organizational Changes: Organizational changes sums up all expensesrelated to introducing the new release of the software solution to theactual organization, such as the operations procedure of the employees.

Technical Setup: This covers the adjustment of other software apart fromthe actual application software that takes place. Examples are thefurther deployment and thus configuration of tools and coding, in thecourse of the upgrade or, if required, the adjustment of the operatingsystem.

Business Setup: This includes the efforts for adjusting the software interms of the upgrade project. In detail, this is the businessconfiguration of the application in terms of maintaining the relevantsettings. Further, business setup includes the customization of all thenecessary system diversifications, for instance, controlling thevalidity of add-ons and their maintenance, and all the tasks related tothe adaptation and maintenance of the modifications and creation of newones. Depending on the upgrade project, other key tasks are the fade inof data and the migration of existing data, for example, from legacysystems into the adjusted solution. Also, the adaptation and creation ofreports based on the business needs, and setup/adjustment of the formsand workflows can be in focus. Adjustment of the authorization conceptand user profiles also might occur. Thus, the reference parameter mustdistinguish between a pure technical upgrade that only requires “deltacustomizing” and the deployment of further functionality shipped withthe new release.

Testing: All these changes and adjustments have to be tested to ensuresmooth operation. In this context, the expenses for the testing areequal to those caused within the implementation phase or continuousimprovement project cost component.

Training: Training efforts depend on the degree of changes within thenewly released application(s) and new or altered functionality. Thus,the training costs are structured in the same way as the trainingexpenses within the implementation phase or continuous improvementproject cost component.

Project Management: Parts of this cost element are all costs that ariseby coordinating and support activities required during the upgradeproject.

2. System Upgrade

System Upgrade refers to all upgrade activities that are performed on arather technical level and are related to a change from one releaseversion to another (e.g., sequencing release version). In focus areupgrades, for instance, of the database managing software that theactual application is running on.

G. End User Usage

As shown in FIGS. 1A and 1H, the cost category “End User Usage” consistsof the productivity loss and end-user operations cost component. It istaken in into account that while the previous cost categories have adirect, budgetary character, the cost category “End User Usage” has anindirect character. This means that in general the costs are notrecorded in kind of accounts (e.g., cost centers as part of the costcenter accounting), but rather are assessed indirectly in terms of, forexample, an increase in effectiveness due to software solution orproductivity loss due to non-availability of the system. Even though,the indirect costs of the cost component “End User Usage” are notinherently part of the company cost accounting, it is of majorimportance to assess them anyhow. The reason it is important is thatthese costs arise in the “End User Usage” area due to, for example, lowusability on average exceeds the direct costs significantly, and thusare a major part of gaining an accurate picture of the total costs of asolution ownership.

1. End User Operations

The cost component “End User Operations” refers to all activities thatdo not have a positive impact on the efficiency of the work processsupported by the software solution and performed by the certain enduser. In this connection, “End User Operations” deals with all coststhat arise in the end user area due to inadequate IT support or lowusability, user productivity and user satisfaction. Here, in a narrowsense, it could be described with the inadequacy of IT support in anyrespect, for example, the help desk. Due to this inadequacy, certain ITtasks are performed by end users, either as a conscious decision becauseinformation system resources are not relied upon (cultural bias towardsself reliance or because service levels do not meet expectations), orbecause information system resources were not allocated for the supportand service functions (leaving end users to provide management andsupport for themselves). But beyond the costs that arise due toinadequacy of IT support, the cost component “End User Operations” alsoassesses the degree of user productivity, determined by the solutioncharacteristics (e.g., expected user interaction paradigm, short cycletimes of work processes, etc.). A major metric is time, but is weightedwith defined cost factors so that comparability to the direct costcategories like “Operation” can be established. An example for assessinguser productivity is the comparison of the cycle time for a benchmarkedworkflow of competitive systems. The meeting of the expected userinteraction paradigm and support of high user productivity have a majorimpact on the work behavior of the employees, and thus the costeffectiveness of the company. In this connection, it is taken intoaccount that while the previously described six direct cost categories(e.g., Implementation) always describe a certain lifecyclephase/situation, the costs arising in the area of the “End User Usage”stretch across all of the lifecycle phases. This means in detail thateffects on the, for example, end user productivity has to be observed inthe case of normal operations as well as in terms of a product upgrade.To which cost category the assessed data is related is recorded by thereference parameters, discussed later.

2. Productivity Loss

The cost component “Productivity Loss” deals with any outage or failureof the standard business software, either in terms of a system breakdownor bottleneck or in terms of planned unavailability of employees due totraining. The two cost elements, shown in FIG. 1H, “Training” and“Downtime” will be described in detail in the following. It is notedthat while productivity loss deals with cost elements directlymeasurable (e.g., system statistics, training accounts), the costcomponent “End User Operations” in contrast deals with cost elementsthat are not directly measurable, and thus with are a ratherunpredictable quantity.

Training: The cost element “Training” refers not to the actual expensesin terms of training costs (e.g., course charges), but rather to thecosts associated with people being prevented from daily work due totraining activities. In this context, regardless of how the trainingactivities are performed (e.g., tutorial tools, classroom training,etc.), there is a cost as long as the employees cannot perform theactual work.

Downtimes: The cost element “Downtime” refers to any system breakdown orbottleneck that causes non-availability or low performance of the actualsoftware solution. Referring to the type of downtime, there is adistinction between planned and unplanned. An example of planneddowntime is the patching or upgrading of the software. Unplanneddowntime would exist in case of an abrupt system failure. Referring tothe origin, it can be caused by the underlying hardware (e.g., lowperformance of the hardware), the network (e.g., inaccessible network)and/or incidents/failures within the software (starting/stopping ofapplication software).

Framework for Providing Context Information

To enable further investigations, the TCO model has to be embedded in ageneral framework, consisting of the appropriate time for investigatingthe operations and a detailed description of how the different directand indirect costs can be incurred (cost types).

A. Definition of the Appropriate Time to Investigate the Operations

There is a suitable time during which the costs of a solution after itsimplementation are to be investigated. Once a solution has successfullygone live, it is not customary to specify when it will be replaced. Asthe company has normally invested a considerable amount of money in thenew IT solution, it is entitled to run the solution at least until itpays back and, more realistically, significantly longer.

The roll out of a solution within the organization can be a complex andchallenging task—potentially as challenging as the actualimplementation—depending on the characteristics of the specific company.By achieving a specific level of complexity, it is more the rule thanthe exception that the duration of a full roll out of a new solution islonger than a year, meaning until it has been rolled out throughout thewhole company to every end user. As the running of an IT solution alwaystakes place within an organization made up of people, it takes a certaintime before they can handle the system and a further period of timebefore they are really familiar with the solution. This phenomenon iscalled the learning curve of the organization, meaning the changes inthe knowledge and behavior of the staff over time. To record this curveholistically, an appropriate time for investigation is assessed.

When assessing the total cost of a software solution, upgrades areconsidered. An upgrade is another challenging task and customers do notwant to upgrade their solution immediately after implementing it. Anestimate of at least two to three years between the implementation of asolution and its upgrade seems to be reasonable. The post-implementationphase of any release upgrade carried out must also be taken intoaccount.

All of these considerations show that if the timeframe for investigatingthe costs is too narrow, the total costs of a solution are not reflectedand any changes over time are not taken into account. Thus, to recordthe costs of solution ownership holistically, a timeline of five toseven years of investigation seems to be appropriate.

B. Description of Cost Types that Potentially Arise in a Cost Phase

As discussed previously, the model is divided into different cost types:Hardware/Software Investment Costs, Implementation Expenses, OngoingHardware/Software Costs, Operations Costs, Expenses for ContinuousImprovement Project, Release Management Costs and costs in the area ofEnd User Usage that are incurred by cut over and running the system andcannot be measured as specifically as the other cost types. In thefollowing there is describes the different types of costs.

1. Hardware/Software Investment Costs

Acquisition costs: These are the acquisition costs arising, forinstance, from acquiring the hardware for the application server,storage, end user environment, further network investment, etc. In casea company decides not to acquire this hardware, but rather leases it,these leasing expenses are assigned accordingly.

Licenses: Depending on the pricing model, the total costs for obtainingthe right of software usage can roughly be split into a fixed amount anda variable amount. Commonly, the fixed amount includes the contractcosts that the customer must pay in order to get the license key and beable to use the software. These contract costs are the base of theinitial license cost component. In this context it is also possible topay a monthly charge in case the customer uses for instance an offer ofan application software provider (ASP) or a business process outsourcer.This monthly charge would be part of the license cost componentaccordingly, as it represents the cost for obtaining the usage right forthe software.

2. Implementation

Project costs/staff costs: Implementation projects are normally carriedout in the conception and realization phase. Within the realization, thestaff can be divided into technical and business experts. In thiscontext, the implementation of the software solution—whether it is theconception or the realization—is carried out by professional externaland/or internal staff. While external staff incurs external projectcosts, the internal staff is either posted to an internal project budgetor is assigned to the project, including their wages in relation to thework they perform. Added up, these costs indicate the total projectcosts. Overall activities, like the setup of the support organizationand operation mainly represented by the project office are based on thesame calculation as for the assigned internal and external staff.

Special Expenses: All costs, not reflecting the expenses for specificstaff, are collected separately and assigned to the appropriate costcomponent. For instance, referring to training costs, the costs forpotential training charges (due requirement of asking for externalcourses) are assigned accordingly.

3. Hardware/Software Ongoing Costs

Technical Infrastructure: Besides the initial investment for hardware,there are also costs for its maintenance. In this context, maintenancemeans the ongoing costs needed to keep the software up-to-date. Aclassical example of those kind of replacement investments are sparesand supplies needed in case the originally hardware part somehow breaks.Therefore, in general, various agreements and contracts can exist, forexample, service contracts for the hardware or special serviceagreements. This can be covered, for instance, by a fixed charge (e.g.,monthly fix charge of, for instance, x percentage calculated on a baseof the actual hardware acquisition price). Costs could also arise interms of single expenses, for instance in case a new disk drive has tobe bought as the original one is broken and the customer does not have amaintenance contract for the hardware.

Licenses: Besides the actual initial investment in the software in orderto get the right to use it, there arise costs on an ongoing base. Aclassical example is the period (e.g., annual) arising applicationsoftware maintenance charge as a chargeback for the security of thecustomer in terms of the support the customer requested, and the use ofspecial services and/or right for regular delivery of further “softwareimprovement,” for example, in terms of support packages.

4. Operations (System and Application Operations)

Internal Staff Costs: The common way that a system is operated within acompany is due to exclusively release staff that charges with a definedskill set and a certain time budget (part time, full time, etc.). Thisis valid in the system operations area, for instance referring to an ITadministrator, but also in the application area. Here, the expert withina department inherits the role of a key user. The wages arising forthese assigned resources are assigned to the cost category operationsaccordingly.

Special Expenses/External Professional Services: In case the system isnot maintained exclusively by the customer, but is in part or totallyoutsourced, the expenses, for instance, in terms of monthly fees, areassigned to the cost components accordingly. In this connection it hasto be taken into account that there are multiple ways how externalprofessional services (e.g., partners) can support the operations of thesystem. Examples are in the system operations, namely, the outsourcingof the system from a technical point of view, and in the use of remoteservices supported by defined tasks like patching. In terms of theapplication operations, the outsourcing of business processes is also anexample.

5. Continuous Improvement Projects

By their nature, continuous improvement projects are normally similar toan implementation. Both are projects, both are carried out in theconception and realization phase, and for both, internal staff and/orexternal professional services are needed. Thus, the same as describedpreviously for the cost category implementation is valid for thecontinuous improvement projects.

6. Upgrade Projects

The situation outlined previously is valid for the cost category upgradeprojects too.

7. End User Usage

A base for assessing the costs arising in the end user usage area ismost commonly the unit “time.” This unit “time” itself is already veryexpressive (e.g., downtime, cycle time for a certain end userworkflow/process). Nevertheless, it also can be assessed with a certaincost factor in order to be comparable with the direct costs—assessed bya monetary unit. As the cost category end user usage is stretched acrossall lifecycle phases, the effects on the end user usage are measured inany of the arising phases. To which cost category the assessed data isrelated is recorded by the reference parameters. In sum, it can be putin relation to the sum of the total direct costs.

Reference Parameters—Clustering

So far, the focus has been on pure figures as they arise along thelifecycle of a deployed software solution. This is the first importantstep in terms of cost assessment. Nevertheless, pure figures are of veryrestricted information content because only a total sum can be statedand not what that means in terms of, for example, whether or not thesecosts are high, average or low. Thus, the pure figures have to be set incontext in order to make them expressive by help of classification. Ingeneral, this can be performed on two levels: 1) in terms of afundamental classification, and 2) in terms of a rather granularassessment by help of further qualifying information.

A. Complexity Information

The purpose of the complexity information is to perform a rather roughclassification by help of rather obvious, and easily recordable data.These data are mandatory for assessment as it allows the assignment ofthe surveyed costs to a specific cluster according to the complexityprofile of the company. Basically there can be mentioned three areas bywhich the complexity profile of a company may be determined. These arethe company profile, the organizational complexity, and the softwarecomplexity. These areas are described in the following.

1. Company Profile: The company profile deals with the parameterindustry, corporate revenue and size of the company. The industrysignifies the area in which the company is running its business, itsfinancial capacity expressed by it corporate revenue and the size of thecompany in terms of the total amount of employees, suppliers andcustomers.

2. Organizational Complexity: The organizational complexity deals withthe parameters of the company organization and its IT organization.While the company organization gives a hint to the rather generalconstitution of the organization, the IT organization deals morespecifically with the customer's specifics while running IT software. Indetail, the complexity of the company organization is defined by theamount of users per user type (occasional vs. power user) and the amountof countries they are active in. In contrast, referring to the ITorganization information regarding the degree of centralization, degreeof platform and system software diversity and special requirements interms of high availability and performance may be surveyed.

3. Software Complexity: Finally, also the software complexity may beunder investigation—in terms of the micro-economic scope of thesolution, the implementation method and the continuousimprovement/replacement rate of the solution. As such, the parameterscope refers to the definition of the implemented solution from amicro-economic point of view. The parameter implementation method shouldgive a hint to the degree of configuration and modification and therequirements of change management—thus the use of best practices in thebroadest sense. Finally the continuous improvement/replacement rateshould express the average, “lifetime” of a solution until it eithergets further improved (requirement for agile solution) or replaced. Thisalso is a hint as to the dynamic and business forces within the valuechain in which the customer is embedded. It may be taken into accountthat, in contrast to the qualifying information, the requirementregarding the complexity information that is not the extent of thesecomplexity parameters in terms of multiple, very detailed parameters isimportant. In fact, the purpose of this complexity information is toserve the goal to deliver a small set of parameters, most commonlyrather easily leviable in any customer situation, but expressive enoughin order to allow a distinctive differentiation of the pure cost figuresto meaningful clusters.

B. Qualify Information

Beside the complexity information there can be surveyed a multitude ofadditional parameters that gives an even deeper insight into the companyconstitutions in terms of deploying and operating IT software. Thisparameter is essential in case route-cause analysis in terms of a e.g.cost drivers on cost element level should be performed. Nevertheless, inmost cases there has to be performed a detailed customer assessment inorder to get this data. Thus, its collection is obligatory, and it israther unrealistic to be able to perform detailed customer assessment inany case. Nevertheless, it is important data and as soon as thepossibility exists to survey the detailed data, it is more than helpful.This detailed information may be collected along the cost categories ona detailed level. An example is within the cost category implementation,namely, the volumes regarding configured workflows, reports and forms,the amount of data that are part of the initial upload into the systemand so on. There may be made available a separate data source (in form,for example, of a spreadsheet file) showing the parameters that arerelevant for each cost category.

Using the TCO Model and Framework

Referring now to FIG. 2, there is shown a conceptual depiction of a newapproach 200 to TCO analyses of enterprise computing systems. Theapproach includes a TCO model 202 that is embedded within a TCOframework 204. The TCO model 202 is a standardized cost accountingmethodology that identifies all of the costs that are to be includedwhen assessing TCO of an enterprise computing system, such as theexample TCO cost accounting methodology described previously.

The TCO framework 204, generally, is what allows TCO analyses to becomestandardized so that useful comparisons may be made between differententerprise computing systems, and optimizations of systems may be made.The TCO framework 204, in this example, has three aspects to it. Thefirst aspect is the storage of TCO cost data within a software solution,or solutions, that are included in the enterprise computing system forwhich a TCO assessment is being made. This means that a softwaresolution included in the system is aligned with the TCO model so thatthe software solution automatically captures the data that are needed toassess the TCO of the system in which the software solution resides. Thedata may be captured, for example, in data that are periodically storedin various databases, and also in transaction data that are createdduring the day-to-day usage of the enterprise computing system. In otherwords, the necessary data are being captured automatically, and arebeing captured within the enterprise computing system for which TCO willbe assessed.

The second aspect of the TCO framework, in this example, is a capabilityto collect and store all data necessary for a TCO analysis in astructured and standardized way, in accordance with the TCO model thatis being used. To illustrate, it will typically be the case that the TCOdata that are being automatically stored within the enterprise computingsystem are being stored in various distributed databases, and along withmuch other data that are not needed in a TCO analysis. As such, thissecond aspect of the TCO framework involves, firstly, aggregating all ofthe TCO data, wherever it may reside, and, secondly, storing theaggregated data in a structured way in accordance with the TCO datamodel. For example, the data will be stored in association with theparticular cost category and component under which the data should beclassified, and in association with the particular cost type under whichthe data should be classified.

The third aspect of the TCO framework is the manner in which TCOanalyses are performed. In other words, standardized methods aregenerated for performing the analysis, so that comparisons may be madeto benchmark data for similar enterprise computing systems that havesimilar characteristics, such as being used for a company of a similarsize and in a similar industry.

FIG. 3 illustrates one example methodology 300 of how the TCO approach200 shown in FIG. 2 may be implemented in practice. In this example, asoftware provider 302 has developed various software solutions 305 thatare sold to customers. Also shown in FIG. 2 is an enterprise computingsystem 330 that has implemented therein software solution 335 that, inone example, was purchased from the software provider 302. In addition,the software solution 335 may include software from other, differentsoftware providers, or vendors, as well as the provider 300 shown inFIG. 3. Also shown in FIG. 3, the software solution 335 includes datastorage 337 that includes, among other data that is stored on acontinual basis in the day-to-day operation of the computing system 330,also TCO data that are aligned with a standardized TCO data model thathas been adopted, as discussed previously in connection with FIG. 2. Assuch, the standardized TCO model creates the base for it.

In the FIG. 3 example, the software provider 302 also has developedpre-configured TCO tools 310 that also may be distributed to customers.For example, the customer's enterprise computing system 330 hasimplemented the pre-configured TCO tool 310, and is shown in system 330as tool 340. In addition, the software provider 302, in this example,has a TCO data collection software application 315. This application 315may be used to collect centrally TCO data 320 conforming to astandardized TCO model from various sources and relating to costsexperienced in different enterprise computing systems, including the oneenterprise computing system 330 shown in FIG. 3. The TCO data collectionapplication may include automated programs that receive and aggregateautomatically TCO data received from the enterprise computing system330, and also may include database programs, such as Microsoft Access,that may be used to manually enter collected TCO data. As shown in FIG.3, the collected TCO data 320 may include data 350 from consultants whoare familiar with one or perhaps more than one enterprise computingsystem, and may have the TCO data conforming to the standardized TCOmodel that has been adopted. In addition, there may be estimated data360 collected as well. Using all of this collected data 320, benchmarkcost data may be determined, and may be determined for differentclusters using the reference parameters described previously in the TCOmodel description above.

Although in FIG. 3 it is shown that the software provider 302 has anddistributes the pre-configured TCO tool 310, has and uses the TCO datacollection application 315 and owns the TCO data 320 that has beencollected, it is not necessary that the software provider 302 performthis role. It may be that a different entity performs these services,such as a consulting entity to name just one example of many.

FIG. 4 shows in more detail an example of the enterprise computingsystem 330 shown in FIG. 3. As shown in FIG. 4, the software solution335 in this example includes several different functional softwarecomponents 410. The functional software components 410 include, in thisexample, a financials and cost accounting component, a human resourcescomponent, a customer relationship management (CRM) component, a supplychain management (SCM) component, a supplier relationship management(SRM) component, a product life cycle (PLM) component, etc. Thefunctional software components shown in FIG. 3 are examples offunctional software components that may be included in an enterprisecomputing system, and are not meant to be an exhaustive list ofcomponents. As shown, each functional software component may have itsown dedicated data source, as shown in FIG. 3, and in additional, oralternatively, there may be, as is also shown in FIG. 3, a central datarepository 420 for storing data.

As mentioned previously, the software application 335 may bespecifically designed to create data that are aligned with thestandardized TCO model and framework that has been adopted. For example,the financials and cost accounting component may have stored projectcosts, for example, expenses involved in certain design orimplementation projects included in the adopted standardized TCO model.The human resources component, for example, may have stored dataproviding time accounting for people that are assigned to performcertain tasks that are considered costs in the adopted TCO model. TheCRM, SCM, SRM and PLM components, for example, may be designed tomonitor and record downtime, which may be a cost included in an adoptedTCO model. Within the financial systems, there could be directlyaccessed and record the data for any financial investments that isassigned to the TCO model. In case the CRM system creates the help deskfor the company, there can be surveyed the service call percomponents/per site/per employee, etc. Besides the human resourcessystem, there can be surveyed the staff that is working in certain areaslike IT department vs. service desk, and the time they are consumingthereby. Potentially, also cycle time for a certain activity as well asuser interaction can be measured by software components which may beconsidered an indirect cost of the enterprise computing system that isincluded in an adopted TCO model.

As shown in FIG. 4, the TCO tools 340 include a centrally aggregated andstructured storage of TCO data. This may be included, for example, in adata warehouse application, such as a Business Information Warehouse(BW) software application provided by SAP A.G of Walldorf, Germany,which application includes data warehousing functionality. Also, thedata may be structured using a multidimensional data model, such asInfoCubes which are a multidimensional model that is used in the SAP A.GBW software application. A multidimensional model such as an InfoCubeoperates to structure data so that the data may be evaluated fromdifferent perspectives, as will be described in more detail later.Again, the structured data may be collected from the data sources thatreside in the functional software components 335. In addition, there maybe additional data that may be added into the structured TCO datastorage that is not data that is provided by the functional softwarecomponents 335. Such data may be, for example, manually entered.

A TCO data extractor tool 440 is a tool that extracts data from the datasources, such as the data sources in the software solution 335 andaggregates the data centrally. The data extractor tool may bepre-configured content that is provided by a software vendor, and mustbe designed with knowledge of the functional software components fromwhich data are being extracted. Various extraction, transformation, andloading (ETL) applications may be used for this purpose. Suchapplications extract the data. Such applications also transform the datainto a common format and load the data so that the data may be furtherprocessed, for example, by being stored in the structured data storagediscussed previously.

A TCO analytics component 450 provides the mechanism to view andevaluate the TCO data that has been aggregated and stored in astructured way in accordance with an adopted TCO model. The TCOanalytics component 450 may provide the ability to generate reports ofthe TCO data, and may also provide the ability to compare the TCO datato benchmarks, so that opportunities for optimization of the solutionmay be evaluated and assessed.

FIG. 5 is a block diagram of a system 500 in which the TCO tools 340shown in FIGS. 3 and 4 may be implemented. In one implementation, thesystem 500 is a business intelligence solution provided by SAP A.G,which includes the previously discussed BW component. BW providesenterprise-wide data warehousing, a business intelligence platform, anda suite of business intelligence tools. BW uses an information modelthat is based on fundamental building blocks called InfoObjects.InfoObjects contain data, such as cost data used in a TCO model.InfoObjects also contain metadata, which describes the data contained inan InfoObject, such as its origin, its history, and technicalproperties. InfoObjects have three classes of metadata: 1) technicalmetadata that describes technical properties, such as data type andfield length; 2) user metadata that contains information aboutauthorizations; and 3) business definitions that form the basis for acommon understanding of business terms, such as key performanceindicators (KPI's).

Data may be transferred into the system 500 from data sources 590 viaapplication program interfaces 505 in a flat structure—a table—ratherthan a multidimensional data structure. Data sources 590, for exampledata sources contained in the software solution 335 shown in FIG. 4.Initially, the received data are stored in a persistent staging area(PSA) 510 under the control of a staging engine 515. The PSA 510 is aset of transparent database tables that act as the initial storage areaof data. Requested data unchanged from the source system (e.g., softwareapplication #1, #2, etc.) is saved according to the structure defined inthe data source 590.

InfoObjects that belong together logically from a business point of vieware grouped into InfoSources. The InfoSources can contain bothtransactional data, which is generated from transaction in an onlinetransaction processing (OLTP) system and master data 520, such as anorganizational structure. Master data 520 typically remains unchangedover a long period of time. An on-line data store (ODS) object which isstored in ODS objects repository 525 describes a consolidated data setfrom one or several InfoSources. In contrast to the multidimensionaldata models of InfoCubes, data in ODS objects are stored in flat,transparent database tables. ODS object data can be updated intoInfoCubes or other ODS objects using a delta update. Data in an ODSobject can be analyzed in the same way as data in InfoCubes with, forexample, a Business Explorer (BEx), the business intelligence tool ofthe SAP Business Intelligence solution.

ODS objects 525 are used to populate a TCO InfoCube 530, under thecontrol of a data manager 535. InfoCubes are containers that organizedata around its multidimensionality in terms of business dimensions. Forexample, the example InfoCube 530 in FIG. 5 has dimensions of 1) costcategory and components as provided in a standardized TCO model such asthe example TCO model described previously, 2) cost type information asprovided in the standardized TCO model, and 3) date. InfoCubes may beaccessed by an application, such as the SAP Business Explorerapplication, for reporting and online analytical processing (OLAP)analysis using OLAP processor 545.

The flow of data may occur as follows. Data source data stored in PSA510 may be transformed into InfoSource data by applying mapping andtransfer rules. Next, update rules handle the subsequent flow of datafrom InfoSources to ODS objects and InfoCubes. Other data flows arepossible also. For example, data may be directly loaded into anInfoCube, or several data sources can be assigned to a singleInfoSource. In many cases, the data that are stored in the PSA 510 hasan incomplete set of metadata. As such, metadata from repository 550,under the control of metadata manager 555, are added when InfoObjectsare created and in InfoObjects are bundled to create an InfoSource.

Referring to FIG. 6, a process is shown for performing a standardizedTCO service for enterprise computing systems. First, at step 605, astandardized TCO model and framework is identified and adopted for use.This is the standardized TCO model described previously. Next, at step610, TCO data are collected from various data sources. As shown, thecollected data may be: 1) data 612 obtained from enterprise computingsystem owners, a part or all of which data may have been collectedautomatically using the techniques previously described; 2) data 614from a services group, for example, a services group for a softwarevendor that may have access to customer TCO data; 3) data 616 from ITconsultants; and 4) other data sources 618.

Next, at step 620, the collected data are stored in a standard,structured manner, in accordance with the adopted standardized TCO modeland framework. This step may occur by various automated and manualmethods, as described previously. At step 630, clusters of enterprisecomputing systems having similar characteristics (for example, a mediumsized company in the pharmaceuticals industry) are defined, for example,according to the previously described reference parameters. At step 640,benchmark data are determined, and also thereafter revised, for thedifferent defined clusters, so that the benchmark data may be analyzedlocally, and so that the benchmark data may be distributed to anenterprise computing system so that local analyses may be conducted.

Referring to FIG. 7, a method is shown for automatic TCO data collectionand TCO report generation. In this example, the method begins, at step705, with a software vendor distributing a TCO model and framework withvarious TCO tools to an enterprise computing system. The enterprisecomputing system may already have implemented software wherein dataaligned to a standardized TCO model and framework are beingautomatically collected. At step 710, the TCO tools are received by theenterprise computing system. At step 715, the automatically generatedTCO data that have been continually stored within the software solutioncomponents are extracted and centrally aggregated and stored in astandardized and structured way in accordance with the TCO data model,as described previously using tools such as the SAP BW application. Assuch, the TCO are now available for analysis and, for example,comparison to benchmark data for the cluster to which the enterprisecomputing system belongs. At step 720, a report of the TCO data may begenerated using any of a number of report generation tools, such as theBusiness Explorer application that is a part of the SAP BW application.Next, at step 725, the enterprise computing system sends the report backto the software vendor, and at step 730, the software vendor receivesthe TCO data report, and the method proceeds to step 620 of the FIG. 6flowchart.

Thus it can be seen that there is a possibility to continuously collectTCO data that all conform to an adopted standardized TCO model, and usethat data to constantly refine and update benchmark data.

FIG. 8 is a block diagram of a computing device 800 that may be includedwithin the enterprise computing system 330 or within a system owned bythe software provider 302 (see FIG. 3), according to one implementation.The computing device 800 includes a processor 802, a memory 804, astorage device 806, an input/output controller 808, and a networkadaptor 810. Each of the components 802, 804, 806, 808, and 810 areinterconnected using a system bus. The processor 802 is capable ofprocessing instructions for execution within the computing device 800.In one implementation, the processor 802 is a single-threaded processor.In another implementation, the processor 802 is a multi-threadedprocessor. The processor 802 is capable of processing instructionsstored in the memory 804 or on the storage device 806 to displaygraphical information for a graphical user interface (GUI) on anexternal input/output device that is coupled to the input/outputcontroller 808.

The memory 804 stores information within the computing device 800. Inone implementation, the memory 804 is a computer-readable medium. In oneimplementation, the memory 804 is a volatile memory unit. In anotherimplementation, the memory 804 is a non-volatile memory unit.

The storage device 806 is capable of providing mass storage for thecomputing device 800. In one implementation, the storage device 806 is acomputer-readable medium. In various different implementations, thestorage device 806 may be a floppy disk device, a hard disk device, anoptical disk device, or a tape device.

In one implementation, a computer program product is tangibly embodiedin an information carrier. The computer program product containsinstructions that, when executed, perform one or more methods, such asthose described above. The information carrier is a computer- ormachine-readable medium, such as the memory 804, the storage device 806,or a propagated signal.

The input/output controller 808 manages input/output operations for thecomputing device 300. In one implementation, the input/output controller808 is coupled to an external input/output device, such as a keyboard, apointing device, or a display unit that is capable of displaying variousGUI's, such as the GUI's shown in the previous figures, to a user.

The computing device 800 further includes the network adaptor 810. Thecomputing device 800 uses the network adaptor 810 to communicate withother network devices. If, for example, the computing system 330 or 302includes a mobile device that includes the computing device 800, thecomputing device 800 uses its network adaptor 810 to communicate with ahost server over a wireless connection.

A number of embodiments of the invention have been described.Nevertheless, it will be understood that various modifications may bemade without departing from the spirit and scope of the invention.Accordingly, other embodiments are within the scope of the followingclaims.

What is claimed is:
 1. A computer-implemented method of collecting dataused in assessing total cost of owning enterprise computing systems, themethod comprising: distributing via a network adapter, to a firstenterprise computing system, a first electronic data file thatidentifies, for use by a data extraction tool comprising pre-configuredsoftware content, predefined data source fields within the firstenterprising computing system that specify predefined costs included ina predefined cost model, the predefined costs to be included in ananalysis of a total cost of owning the first enterprise computingsystem; receiving via the network adapter, from the first enterprisecomputing system, first cost information based on data automaticallyextracted from the predefined data source fields of the first enterprisecomputing system by the data extraction tool using the distributed firstelectronic data file, wherein the first cost information is structuredbased on the predefined cost model; distributing via the networkadapter, to a second enterprise computing system, a second electronicdata file that identifies, for use by the data extraction tool, secondpredefined data source fields within the second enterprising computingsystem that specify the predefined costs included in the predefined costmodel, at least one of the second predefined data source fieldsspecifying a particular predefined cost being different from apredefined data source field of the first enterprise computing systemspecifying the particular predefined cost, and the predefined costs tobe included in an analysis of a total cost of owning the secondenterprise computing system; receiving via the network adapter, from thesecond enterprise computing system, second cost information based ondata automatically extracted from the second predefined data sourcefields of the second enterprise computing system by the data extractiontool using the distributed second electronic data file, wherein thesecond cost information is structured based on the predefined costmodel; using the received first and second cost information todetermine, by a processor, benchmark total cost of ownership costinformation that is structured based on the predefined cost model; andstoring the determined benchmark total cost of ownership costinformation in a storage device.
 2. The method of claim 1, furthercomprising receiving third cost information compiled by a informationtechnology consultant and including costs associated with an enterprisecomputing system, and which consultant-provided cost information isstructured in conformity with the predefined cost model.
 3. The methodof claim 1, wherein multiple different benchmark cost information areformulated for enterprising computing systems having a differentpredefined value for a predefined characteristic of enterprise computingsystem.
 4. The method of claim 3, wherein the predefined characteristicis a size category of an enterprise in which the enterprise computingsystem is implemented.
 5. The method of claim 3, wherein the predefinedcharacteristic is an industry type category for an enterprise in whichthe enterprise computing system is implemented.
 6. The method of claim1, further comprising electronically distributing the determinedbenchmark cost information to an enterprise computing system.
 7. Themethod of claim 6, wherein the enterprise computing system to which thebenchmark cost information is distributed is configured to aggregatecost information related to its total costs of ownership in conformitywith the predefined cost model.
 8. The method of claim 7, wherein theenterprise computing system to which the benchmark cost information isdistributed is further configured to provide a comparison of itsaggregated total cost of ownership cost information with distributedbenchmark cost information received by the enterprise computing system.9. A computer-implemented method of supporting an assessment of a totalcost of owning an enterprise computing system, the method comprising:receiving, via a network adapter, total cost of ownership costinformation relating to enterprise computing systems, wherein the costinformation for each such enterprise computing system is structured inconformity with a predefined cost model that defines costs to beincluded in an analysis of a total cost of owning an enterprisecomputing system, and wherein the receiving of the cost informationcomprises: distributing via the network adapter, to a first enterprisecomputing system, a first electronic data file that identifies, for useby a data extraction tool comprising pre-configured software content,predefined data source fields within the first enterprising computingsystem and that specify predefined costs included in the predefined costmodel; receiving via the network adapter, from the first enterprisecomputing system, first cost information aggregated using dataautomatically extracted from the predefined data source fields withinthe first enterprising computing system using the distributed first datafile, wherein the first cost information is structured in conformitywith the predefined cost model; distributing via the network adapter, toa second enterprise computing system, a second electronic data file thatidentifies, for use by the data extraction tool, second predefined datasource fields within the second enterprising computing system and thatspecify the predefined costs included in the predefined cost model, atleast one of the second predefined data source fields specifying aparticular predefined cost being different from a predefined data sourcefield of the first enterprise computing system specifying the particularpredefined cost; and receiving via the network adapter, from the secondenterprise computing system, second cost information aggregated usingdata automatically extracted from the second predefined data sourcefields using the distributed second data file, wherein the second costinformation is structured in conformity with the predefined cost model;using the received cost information to formulate, by a processor,benchmark total cost of ownership cost information that is structured inconformity with the predefined cost model; storing the benchmark totalcost of ownership cost information in a storage device; and distributingto an enterprise computing system 1) a total cost of ownership costanalysis tool that is designed in conformity with the predefined costmodel and that is used to perform a local analysis of the total cost ofownership for the enterprise computing system to which the cost analysistool is distributed, and 2) the formulated benchmark total cost ofownership cost information for use in the local total cost of ownershipanalysis.
 10. The method of claim 9, wherein multiple differentbenchmark cost information are formulated for enterprising computingsystems having a different predefined value for a predefinedcharacteristic of enterprise computing system.
 11. The method of claim10, wherein the predefined characteristic is a size category of anenterprise in which the enterprise computing system is implemented. 12.The method of claim 10, wherein the predefined characteristic is anindustry type category for an enterprise in which the enterprisecomputing system is implemented.
 13. The method of claim 9, wherein thedistribution of the determined benchmark cost information isaccomplished by electronically distributing the determined benchmarkcost information to an enterprise computing system.
 14. The method ofclaim 9, wherein the enterprise computing system to which the benchmarkcost information is distributed is configured to aggregate costinformation related to its total costs of ownership in conformity withthe predefined cost model.
 15. The method of claim 9, wherein theenterprise computing system to which the benchmark cost information isdistributed is further configured to provide a comparison of itsaggregated total cost of ownership cost information with distributedbenchmark cost information received by the enterprise computing system.16. The method of claim 9, wherein the receiving of the cost informationis accomplished at least in part by receiving cost information compiledby a information technology consultant and including costs associatedwith an enterprise computing system, and which consultant-provided costinformation is structured in conformity with the predefined cost model.17. A computer program product tangibly embodied in a non-transitorymachine-readable storage device, the computer program product includinginstructions that, when executed, cause a processor to performoperations comprising: distributing, to a first enterprise computingsystem, a first electronic data file that identifies, for use by a dataextraction tool comprising pre-configured software content, predefineddata source fields within the first enterprising computing system thatspecify predefined costs included in a predefined cost model, thepredefined costs to be included in an analysis of a total cost of owningthe first enterprise computing system; receiving, from the firstenterprise computing system, first cost information based on dataautomatically extracted from the predefined data source fields of thefirst enterprise computing system by the data extraction tool using thedistributed first electronic data file, wherein the first costinformation is structured based on the predefined cost model;distributing, to a second enterprise computing system, a secondelectronic data file that identifies, for use by the data extractiontool, second predefined data source fields within the secondenterprising computing system that specify the predefined costs includedin the predefined cost model, at least one of the second predefined datasource fields specifying a particular predefined cost being differentfrom a predefined data source field of the first enterprise computingsystem specifying the particular predefined cost, and the predefinedcosts to be included in an analysis of a total cost of owning the secondenterprise computing system; receiving, from the second enterprisecomputing system, second cost information based on data automaticallyextracted from the second predefined data source fields of the secondenterprise computing system by the data extraction tool using thedistributed second electronic data file, wherein the second costinformation is structured based on the predefined cost model; using thereceived first and second cost information to determine benchmark totalcost of ownership cost information that is structured based on thepredefined cost model; and storing the determined benchmark total costof ownership cost information in a storage device.
 18. A systemcomprising: a first enterprise computing system; a second enterprisecomputing system; and a computing device to: distribute, to the firstenterprise computing system, a first electronic data file thatidentifies, for use by a data extraction tool comprising pre-configuredsoftware content, predefined data source fields within the firstenterprising computing system that specify predefined costs included ina predefined cost model, the predefined costs to be included in ananalysis of a total cost of owning the first enterprise computingsystem; receive, from the first enterprise computing system, first costinformation based on data automatically extracted from the predefineddata source fields of the first enterprise computing system by the dataextraction tool using the distributed first electronic data file,wherein the first cost information is structured based on the predefinedcost model; distribute, to the second enterprise computing system, asecond electronic data file that identifies, for use by the dataextraction tool, second predefined data source fields within the secondenterprising computing system that specify the predefined costs includedin the predefined cost model, at least one of the second predefined datasource fields specifying a particular predefined cost being differentfrom a predefined data source field of the first enterprise computingsystem specifying the particular predefined cost, and the predefinedcosts to be included in an analysis of a total cost of owning the secondenterprise computing system; receive, from the second enterprisecomputing system, second cost information based on data automaticallyextracted from the second predefined data source fields of the secondenterprise computing system by the data extraction tool using thedistributed second electronic data file, wherein the second costinformation is structured based on the predefined cost model; determine,using the received first and second cost information, benchmark totalcost of ownership cost information that is structured based on thepredefined cost model; and store the determined benchmark total cost ofownership cost information in a storage device.